Kent says Canada still plans to eliminate fossil fuel subsidies

OTTAWA — Canada still plans to phase out subsidies in its oil, gas and coal industries, Environment Minister Peter Kent said Monday in the House of Commons.

He made the comments in response to questions about recent Postmedia News coverage of Canada's efforts at an international environmental summit in Brazil to block a firm commitment by all countries to phase out the incentives for production or consumption of fossil fuels.

Kent noted that Canada has already made this commitment along with its counterparts from the G20, but suggested that any further commitment at the Rio+20 Earth Summit would compromise Canada's sovereignty.

"Let me remind my colleague that Canada is committed to phasing out fossil fuel subsidies, at least as a member of G20, and our position at Rio has not changed," Kent said, in response to NDP deputy leader Megan Leslie.

"However, I will also remind my colleague that Canada will not, in the development of the outcome documents, surrender sovereignty over either our environmental policies or responsible resource development."

Leslie said that members of the Conservative government were trying to protect oil and gas companies.

"Basically they are doing whatever their big oil friends want them to do," Leslie said.

According to a leaked draft text that was obtained by the Guardian newspaper, Canadian negotiators at the Brazil summit have asked the conference to "consider" a phase-out of the subsidies, instead of backing stronger language proposed by the European Union calling for a firm commitment to eliminate the subsidies.

Globally, the subsidies are estimated to total hundreds of billions of dollars per year, according to the International Energy Agency, a partnership of 28 countries that offers advice and analysis of energy policies.

Many energy and environmental experts suggest that eliminating the subsidies would make it easier to lower greenhouse gas emissions associated with fossil fuels since the funding or incentives actually encourage consumption of oil, gas and coal by artificially lowering prices.

David Sawyer, an environmental economist and director of climate change and energy at the International Institute for Sustainable Development, recognized that the government has taken some steps in recent years to reduce the subsidies. But he estimated that it could still save more than $1.3 billion a year if it phases out all of the subsidies for the oil and gas industries.

Former Conservative environment minister Jim Prentice, who left politics in November 2010 to accept an executive position at the Canadian Imperial Bank of Commerce, urged Finance Minister Jim Flaherty in a memorandum to phase out the oil and gas subsidies and honour Canada's G20 commitment. But Flaherty has protected many of the tax incentive programs for oil and gas exploration and development.

Kent is scheduled to travel to the Brazil summit later this month to lead Canada's delegation at the Brazil conference on sustainable development, which marks the 20th anniversary of the 1992 Earth Summit in Rio de Janeiro.

The concept of "sustainable development" emerged following a 1987 United Nations report called "Our Common Future" that was prepared by a commission led by former Norwegian prime minister Gro Harlem Brundtland.

The report said "humanity has the ability to make development sustainable to ensure that it meets the needs of the present without compromising the ability of future generations to meet their own needs." It provided the basis for major international environmental agreements reached at the 1992 Earth Summit in Rio de Janeiro, Brazil to protect biodiversity and crack down on heat-trapping pollution linked to global warming.

The government's lead negotiator at the 2012 summit is Keith Christie, an assistant deputy minister from the Department of Foreign Affairs and International Trade.

Christie has been involved in Canada's diplomatic efforts to promote the oilsands industry and jokingly referred to the exercise as "doing God's work," in an internal e-mail from June 2010 obtained by Postmedia News.